Blixseth v. Cushman & Wakefield of Colorado, Inc et al

Filing 91

ORDER. ORDERED that Credit Suisse's Motion for Reconsideration [Docket No. 63] is DENIED. ORDERED that plaintiff's Motion to Reconsider Courts Order Granting Credit Suisse's Motion to Dismiss in Part and Cushman and Wakefield's Motion to Dismiss [Docket No. 64] is DENIED by Judge Philip A. Brimmer on 09/26/14.(jhawk, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge Philip A. Brimmer
Civil Action No. 12-cv-00393-PAB-KLM
TIMOTHY L. BLIXSETH, an individual,
Plaintiff,
v.
CREDIT SUISSE AG, a Swiss corporation,
CREDIT SUISSE GROUP AG, a Swiss corporation,
CREDIT SUISSE SECURITIES (USA), LLC, a Delaware limited liability company,
CREDIT SUISSE (USA), INC., a Delaware corporation,
CREDIT SUISSE HOLDINGS (USA), INC., a Delaware corporation,
CREDIT SUISSE CAYMAN ISLAND BRANCH, an entity of unknown type, and
DOES 1-100,
Defendants.

ORDER

This matter is before the Court on the Motion for Reconsideration [Docket No.
63] filed by Credit Suisse1 and the Motion to Reconsider Court’s Order Granting Credit
Suisse’s Motion to Dismiss in Part and Cushman and Wakefield’s Motion to Dismiss
[Docket No. 64] filed by plaintiff Timothy Blixseth.
I. BACKGROUND2
On February 14, 2012, plaintiff filed the present case, asserting claims against all
defendants for (1) violations of the Racketeer Influenced and Corrupt Organizations Act
1

Terms used in this order have the meaning set forth in the Court’s Order on
defendants’ motions to dismiss. See Docket No. 61.
2

The relevant background facts have been set forth at length elsewhere and will
not be restated here except as relevant to resolving the present motions. See Docket
No. 61 at 2-10.

(“RICO”), 18 U.S.C. §§ 1961-1968; (2) common law fraud; (3) breach of fiduciary duty;
(4) common law negligence and negligent misrepresentation; (5) tortious interference
with contractual relations; (6) breach of covenants of good faith and fair dealing under
the Uniform Commercial Code and common law; (7) breach of contract; (8) equitable
indemnity; and (9) common law conspiracy. Docket No. 1 at 68-83. Cushman and
Credit Suisse filed motions to dismiss. Docket No. 24; Docket No. 28. In response to
Cushman’s motion to dismiss, plaintiff indicated that he was no longer pursuing his
claims for tortious interference of contract, breach of contract, and equitable indemnity
against Cushman. See Docket No. 34 at 34. Similarly, in his response to Credit
Suisse’s motion to dismiss, plaintiff stated that he is no longer seeking to prosecute his
equitable indemnity claim against Credit Suisse. Docket No. 35 at 35.
On September 30, 2013, the Court dismissed all of plaintiff’s claims against
Cushman. Docket No. 61 at 29. The Court dismissed plaintiff’s RICO, fraud, breach of
fiduciary duty, negligence and negligent misrepresentation, breach of contract,
equitable indemnity, breach of the implied covenant of good faith and fair dealing, and
conspiracy claims against Credit Suisse. Id. The Court granted plaintiff leave to amend
with respect to his claim for breach of the implied covenant of good faith and fair
dealing against Credit Suisse and allowed plaintiff to proceed with his tortious
interference claim against Credit Suisse, id., claims which plaintiff now asserts in the
First Amended Complaint and Jury Demand [Docket No. 68]. On October 4, 2013,
Credit Suisse filed a motion to reconsider, requesting that the Court reconsider its ruling
on plaintiff’s claim for tortious interference. Docket No. 63 at 2. On October 8, 2013,
plaintiff filed a motion to reconsider, requesting that the Court reconsider its ruling
2

dismissing plaintiff’s RICO, fraud, breach of fiduciary duty, and negligence and
negligent misrepresentation claims. Docket No. 64 at 2. 3 Credit Suisse and Cushman
filed responses. Docket Nos. 69, 71.
II. STANDARD OF REVIEW
The Federal Rules of Civil Procedure do not specifically provide for motions for
reconsideration, see Hatfield v. Bd. of County Comm’rs for Converse County, 52 F.3d
858, 861 (10th Cir. 1995), and, where a party files a motion for reconsideration prior to
the entry of judgment or of a final order, Rules 59(e) and 60(b) do not apply. Houston
Fearless Corp. v. Teter, 313 F.2d 91, 92 (10th Cir. 1962). Instead, m otions for
reconsideration fall within a court’s plenary power to revisit and amend interlocutory
orders as justice requires. See Paramount Pictures Corp. v. Thompson Theatres, Inc.,
621 F.2d 1088, 1090 (10th Cir. 1980) (citing Fed. R. Civ. P. 54(b)); see also Houston
Fearless Corp., 313 F.2d at 92. However, in order to avoid the inefficiency which would
attend the repeated re-adjudication of interlocutory orders, judges in this district have
imposed limits on their broad discretion to revisit interlocutory orders. See, e.g.,
Montano v. Chao, No. 07-cv-00735-EWN-KMT, 2008 WL 4427087, at *5-6 (D. Colo.
Sept. 28, 2008) (applying Rule 60(b) analysis to the reconsideration of interlocutory
order); United Fire & Cas. Co. v. McCrerey & Roberts Constr. Co., No.
06-cv-00037-WYD-CBS, 2007 WL 1306484, at *1-2 (D. Colo. May 3, 2007) (applying
Rule 59(e) standard to the reconsideration of the duty-to-defend order); M.M. v.
Zavaras, 939 F. Supp. 799, 801 (D. Colo. 1996) (applying law of the case doctrine to
3

Credit Suisse’s motion to dismiss plaintiff’s amended claim for breach of the
implied duty of good faith and fair dealing is pending. Docket No. 73.
3

motion for reconsideration of interlocutory order). Regardless of the analysis applied,
the basic assessment tends to be the same: courts consider whether new evidence or
legal authority has emerged or whether the prior ruling was clearly in error. Motions to
reconsider are generally an inappropriate vehicle to advance “new arguments, or
supporting facts which were available at the time of the original motion.” Servants of
the Paraclete v. Does, 204 F. 3d 1005, 1012 (10th Cir. 2000).
A. Credit Suisse’s Motion to Reconsider
Plaintiff and Edra Blixseth entered into a Marital Settlement Agreement (“MSA”),
Docket No. 1 at 37, ¶ 93, which contained terms releasing plaintiff from liability (the
“releases”). Id. at 75, ¶ 186. The Yellowstone Club was subsequently placed in
Chapter 11 involuntary bankruptcy proceedings in the United States Bankruptcy Court
for the District of Montana. Docket No. 61 at 8; Docket No. 63 at 3. After a Chapter 11
plan was confirmed (the “Third Amended Plan”), the Liquidating Trust was formed to
collect the balance of the $375 million loan from plaintiff’s individual assets. Docket No.
1 at 54, 56, ¶¶ 119(p), 120. Plaintiff claims that Credit Suisse exercised control over
the Liquidating Trust and induced the Liquidating Trust to bring an adversary
proceeding (“AP-14”) against plaintiff to recover the loan proceeds, claiming breach of
fiduciary duty and fraudulent transfer of assets. Docket No. 1 at 40, ¶ 102. The
bankruptcy court found that, with respect to the claims asserted by the Liquidating
Trust, plaintiff obtained the releases “with the actual intent to hinder, delay, and defraud
his creditors” and found the releases to be a fraudulent transfer and, for purposes of the

4

adversary proceeding, “voidable” under Montana law. In re Yellowstone Mountain Club,
LLC, 436 B.R. 598, 664 (Bankr. D. Mont. 2010).
On August 30, 2011, as part of the BGI bankruptcy, BGI’s claims against plaintiff
were transferred to the Liquidating Trust for purposes of collection. In re BLX Grp. Inc.,
No. 09-61893-RBK (Bankr. D. Mont. August 30, 2011) (Docket No. 769 at 1-2). On
October 5, 2011, the Liquidating Trust brought suit against plaintiff in the United States
District Court for the Central District of California to recover on BGI’s claims. Kirschner
v. Blixseth, No. 11-cv-08283-GAF-SP (C.D. Cal. October 5, 2011) (Docket No. 1). The
Liquidating Trust sought to “set aside the release of Blixseth’s liability on the Notes as a
fraudulent transfer under 11 U.S.C. § 548(a) and California Civil Code § 3439.04, and
to collect on the Notes under a breach of contract theory.” Id. (Docket No. 72 at 5). Mr.
Blixseth filed a motion to dismiss under Fed. R. Civ. P. 12(b)(1) and 12(b)(6), which the
court denied. Id. (Docket No. 18 at 13). Mr. Blixseth then filed counterclaims for
contribution and unjust enrichment against Credit Suisse. Id. (Docket No. 27 at 3-4).
The court noted that the factual allegations underlying the claims against the
Liquidating Trust, which were incorporated into the claims asserted against Credit
Suisse, were “substantially similar” to those asserted by plaintiff in the present case. Id.
(Docket No. 72 at 6). On November 1, 2012, the court dismissed Mr. Blixseth’s
counterclaims against Credit Suisse pursuant to Fed. R. Civ. P. 12(b)(6). Id. (Docket
No. 72 at 2, 36). On June 18, 2014, the court g ranted summary judgment in favor of
the Liquidating Trust, giving preclusive effect to the bankruptcy court’s ruling in In re

5

Yellowstone Mountain Club that the releases were fraudulent transfers. Id. (Docket No.
123 at 11).4
Plaintiff’s original tortious interference claim alleged that, under the terms of the
Third Amended Plan, the Liquidating Trust was created for the purpose of pursuing
litigation against plaintiff and is controlled by, and/or acts for the benefit of, Credit
Suisse. Docket No. 1 at 74, ¶¶ 184, 185. Credit Suisse alleg edly “caused the
Liquidating Trustee to assert that the releases were invalid and not enforceable, thus
depriving Plaintiff of an extremely valuable contract right.” Docket No. 1 at 75, ¶ 187.
Plaintiff also alleged that Credit Suisse sought to be repaid “by taking all of the assets
that plaintiff received [or] was to receive out of the MSA.” Id. at 75-76, ¶ 188.
Credit Suisse argues that the acts upon which plaintiff’s tortious interference
claim are based were authorized by the bankruptcy court as part of the Third Amended
Plan such that plaintiff’s claim is barred by “bankruptcy preemption.” Docket No. 63 at
6. Credit Suisse’s argument is insufficient for multiple reasons. First, the premise of
Credit Suisse’s argument – that the Third Amended Plan authorized all of Credit
Suisse’s allegedly wrongful acts – is contradicted by plaintiff’s allegations, which must
be taken as true. It is not disputed that the T hird Amended Plan authorized the

4

Although the Kirschner order on Credit Suisse’s motion to dismiss may have
been issued after briefing was completed on the motions to dismiss in the present case,
Credit Suisse made no attempt to file a supplemental brief with such information,
despite ample time to do so, before the Court’s Order was issued. Thus, Credit
Suisse’s claim that the Kirschner order is proper evidence to consider in this motion is
unpersuasive. See Servants of Paraclete, 204 F.3d 1012 (noting that supporting facts
that were previously available are rarely a basis for a motion for reconsideration).
Nonetheless, the Court finds that the Kirschner case provides relevant context for the
parties’ arguments and will consider it only for that limited purpose.
6

Liquidating Trust to pursue plaintiff in order to recover loan proceeds. Docket No. 1 at
41, ¶ 103. However, plaintiff alleges that Credit Suisse engaged in conduct that is
separate from or predates the conduct authorized under the Third Amended Plan. For
example, although the Liquidating Trust’s authority to pursue plaintiff under the Third
Amended Plan is undisputed, plaintiff claims Credit Suisse exerted control over the
Liquidating Trust and “caused” the Liquidating Trust to decide to assert that the
releases were invalid. Id. at 74-75, ¶¶ 185, 188. Additionally, plaintiff claims that Credit
Suisse influenced the creation of the “Term Sheet,” which made plaintiff “the sole target
in funding a bankruptcy plan” and was incorporated into the Third Amended Plan.
Docket No. 1 at 75, ¶ 188; see also id. at 76, ¶ 190 (alleging that Credit Suisse
“negotiat[ed] for and . . . approved the Third Amended Plan” that made plaintiff the “sole
litigation target to collect over $280 million”). In other words, plaintiff’s claim appears
based, not on the authorized actions taken by the Liquidating Trust, but on Credit
Suisse’s actions in knowingly inducing the Liquidating Trust to take legal action with the
purpose of furthering Credit Suisse’s allegedly wrongful goal of interfering with the
MSA. Such conduct arguably falls within the exception to the Third Amended Plan’s
exculpatory clause, which contemplates that liability may exist for “willful misconduct or
gross negligence” as determined by an order of the bankruptcy court or other court of
competent jurisdiction. See Docket No. 28-12 at 48, § 8.4; id. at 16, ¶ 1.62 (defining
“Final Order”). Thus, Credit Suisse fails to support its assertion that the bankruptcy
court “expressly authorize[d] the specific actions upon which Blixseth’s tortious
interference claim is based.” See Docket No. 70 at 5.

7

Second, Credit Suisse fails to identify information relevant to its bankruptcy
preemption analysis. Credit Suisse asserts, with little explanation, that “bankruptcy
preemption” bars plaintiff’s claims for actions taken under orders issued by a
bankruptcy court. Docket No. 63 at 6. State laws are preempted in three
circumstances: (1) express preemption, when Congress expressly defines the extent to
which a federal law preempts state law, (2) implied preemption, when state law
“‘regulates conduct in a field that Congress intended the Federal Government to occupy
exclusively,’” and (3) conflict preemption, when state law actually conflicts with federal
law. See Glannon v. Garrett & Assocs., Inc., 261 B.R. 259, 263 (D. Kan. 2001) (quoting
English v. General Elec. Co., 496 U.S. 72, 78 (1990)) (explaining express, implied, and
conflict preemption). Credit Suisse does not appear to assert express preemption and
fails to identify a specific provision of the Bankruptcy Code that would conflict with a
state law claim for tortious interference with contract; thus, by process of elimination,
Credit Suisse appears to argue that plaintiff’s claims are barred by the doctrine of
implied preemption.
State law claims related to abuse of the bankruptcy process brought by a creditor
or debtor are, in many circumstances, impliedly preempted by the Bankruptcy Code.
See Glannon, 261 B.R. at 265 (collecting cases); Leonard v. McMorris, 106 F. Supp. 2d
1098, 1115 (D. Colo. 2000) (considering whether Wage Act claim brought against nondebtor was preempted and concluding that “defendants have not cited any language in
the Bankruptcy Code which extends the Bankruptcy Code’s protection to individuals or
entities which have not filed a bankruptcy petition . . . [h]ad Congress intended that
bankruptcy protection extend beyond the entity filing the bankruptcy petition, it could
8

have drafted the Bankruptcy Code to so provide”), reversed on state law grounds, 320
F.3d 1116 (10th Cir. 2003). Although Congress has provided remedies designed to
prohibit misuse of the bankruptcy process, Credit Suisse does not identify which
remedies are applicable to the present case. 5
Credit Suisse bases its bankruptcy preemption argument on two cases. In E.
Equip. & Servs. Corp. v. Factory Point Nat’l Bank, 236 F.3d 117, 119 (2d Cir. 2001),
plaintiffs brought various tort claims against a creditor, alleging that the creditor violated
the automatic stay in the plaintiffs’ personal bankruptcy by foreclosing on property
owned by the plaintiffs’ corporation. The Second Circuit concluded that “state tort
claims alleging violations of an automatic stay must be ‘brought in the bankruptcy court
itself and not as a separate action in the district court.’” Id. at 120-21 (quoting MSR
Exploration, Ltd. v. Meridian Oil, Inc., 74 F.3d 910, 916 (9th Cir. 1996)). However,
Factory Point does not address whether preemption extends to situations where, as
here, the plaintiff is not a debtor and does not claim the violation of an automatic stay.
In Astor Holdings, Inc. v. Roski, 325 F. Supp. 2d 251 (S.D.N.Y. 2003), the plaintiff was
a creditor who alleged that defendant, a non-party to the underlying bankruptcy,
induced breaches of an agreement between the debtor and creditor, including the
allegation that defendant induced the debtor into filing for bankruptcy. Id. at 254-55,
259-60. The court found that the Bankruptcy Code contains remedies for the misuse of
5

Credit Suisse appears to suggest that plaintiff had an opportunity to challenge
Credit Suisse’s misuse of the bankruptcy process in AP-14. Docket No. 28 at 10 (citing
In re Yellowstone Club, 436 B.R. at 675). However, Credit Suisse does not indicate
whether plaintiff brought, or had the ability to bring, a claim directly against Credit
Suisse during the Yellowstone Club bankruptcy. As such, Credit Suisse fails to show
how AP-14 is relevant to the issue of preemption.
9

process and that such misuse was exclusively governed by the Bankruptcy Code.
Relying on the “sweeping language” in Factory Point and MSR Exploration, the court
concluded that plaintiff’s claims based upon the improper or abusive filing of bankruptcy
papers were preempted. Id. at 262-63.6 Roski, while similar to the present case in
some respects, concerned a creditor attempting to challenge the propriety of a
bankruptcy proceeding, whereas plaintiff in the present case is neither a creditor nor a
debtor to the bankruptcy attempting to hold Credit Suisse, a creditor, liable for its
actions in influencing the Liquidating Trust. Based on those differences in Factory Point
and Roski, and the above-noted gaps in Credit Suisse’s argument, the Court cannot
conclude that Credit Suisse has satisfied its burden of showing clear error. See Cook v.
Rockwell Int’l Corp., 618 F.3d 1127, 1143 (10th Cir. 2010) (“Because Def endants
advocate preemption, they bear the burden of showing that federal and state law
conflict.”).
Another factor justifying the denial of Credit Suisse’s motion for reconsideration
is its reliance on facts of which the Court cannot take judicial notice. For example,
Credit Suisse argues that plaintiff’s claim fails because the bankruptcy court in AP-14
determined that Credit Suisse did not control the liquidating trust. Docket No. 63 at 6.
6

Roski also relies on a California case, Choy v. Redland Ins. Co., 103 Cal. App.
4th 789, 801 (Cal. App. 2002), which held that “no authorized proceeding in bankruptcy
can be questioned in a state court or used as the basis f or the assertion of a tort claim
in state court against any defendant.” In Choy, plaintiff was injured in a car accident
and brought an abuse of process claim against a bankrupt company’s insurer, claiming
that the company was induced by its insurer to file a bankruptcy petition so as to avoid
paying plaintiff’s claim. Id. Plaintiff argued that his claim was not preempted because it
was not a suit by or against a bankruptcy debtor, an argument the court rejected based
upon a line of California cases holding that authorized bankruptcy proceedings cannot
support state law claims for malicious prosecution or abuse of process. Id. at 800-01.
10

Credit Suisse’s argument, without explicitly saying so, appears to imply that the
bankruptcy court findings should be given preclusive effect in the present case.
However, in order to establish issue preclusion, Credit Suisse must show that (1) the
issue presented in the current case is identical to an issue actually litigated and
necessarily adjudicated in the prior proceeding; (2) the prior action reached a final
adjudication on the merits; (3) the party against whom the doctrine is raised was a
party, or in privity with a party, to the prior adjudication, and (4) the party against whom
the doctrine is raised had a full and fair opportunity to litigate the issue in the prior
action. Bebo Constr. Co. v. Mattox & O’Brien, P.C., 990 P.2d 78, 84-85 (Colo. 1999).
Credit Suisse makes no attempt to satisfy any of the four elements.
Credit Suisse argues that the Court can take judicial notice of “pertinent facts . . .
developed by a decision in the Central District of California.” Docket No. 63 at 2 n.2.
Credit Suisse misunderstands the concept of judicial notice. A court may judicially
notice a document filed in another court to “establish the fact of such litigation and
related filings,” but “[f]acts adjudicated in a prior case do not meet either test of
indisputability contained in Rule 201(b).” Int’l Star Class Yacht Racing Ass’n v. Tommy
Hilfiger U.S.A., Inc., 146 F.3d 66, 70 (2d Cir. 1998) (quotations omitted). Thus, the
Court cannot judicially notice another court’s findings of fact for their truth and,
furthermore, finds it inappropriate to convert Credit Suisse’s Rule 12(b)(6) motion into a
motion for summary judgment. See Alvarado v. KOB-TV, L.L.C., 493 F.3d 1210, 121516 (10th Cir. 2007) (holding that converting Rule 12(b)(6) motion to motion for summary
judgment should only be done after the parties have had a reasonable opportunity to
present material made pertinent to such a motion). It is more appropriate for the Court
11

to consider Credit Suisse’s arguments on a more complete record. See, e.g., Kirschner
(Docket No. 123 at 11). 7 Thus, Credit Suisse has failed to show that it is entitled to the
requested relief and, as such, its motion for reconsideration will be denied.
B. Plaintiff’s Motion to Reconsider
Plaintiff challenges the Court’s finding that plaintiff lacked standing to assert his
RICO, fraud, breach of fiduciary duty, and negligence and negligent misrepresentation
claims (the “subject claims”). Docket No. 64 at 3. The Court dismissed the subject
claims, finding that the injuries plaintiff alleged were derivative. Docket No. 61 at 14,
16-17, 18, 20. 8
As set forth in the Court’s Order, the shareholder standing doctrine is an
equitable restriction prohibiting “‘shareholders from initiating actions to enforce the
rights of the corporation.’” Bixler v. Foster, 596 F.3d 751, 756-57 (10th Cir. 2010)
(quoting Franchise Tax Bd. of Cal. v. Alcan Aluminium Ltd., 493 U.S. 331, 336 (1990)).
In general, “conduct which harms a corporation confers standing on the corporation, not
its shareholders.” Id. at 756. A shareholder lacks standing if his or her losses are “only
derivative of a corporation’s – when the individuals’ losses come about only because of
the firm’s loss.” Niemi v. Lasshofer, 728 F.3d 1252, 1260 (10th Cir. 2013). However,
any shareholder with “a direct, personal interest in a cause of action” may bring suit
“even if the corporation’s rights are also implicated.” Franchise Tax Bd., 493 U.S. at
7

Of course, Credit Suisse will have the ability to file a motion for summary
judgment on this issue.
8

Plaintiff fails to address the Court’s alternative basis for dismissing plaintiff’s
claim for breach of fiduciary duty, namely, his failure to allege that defendants owed
plaintiff a fiduciary duty. Docket No. 61 at 18.
12

336. In order to satisfy this exception, the plaintiff must show “some way in which his or
her losses are not derivative of the corporation’s losses.” Niemi, 728 F.3d at 1260.
Plaintiff does not dispute the relevant law, but instead argues that the Court’s
reliance on two cases was misplaced. First, plaintiff is critical of the Court’s reliance on
Bixler, arguing that “the type of injury alleged in more akin to the facts in Behunin v.
Dow Chemical Co., 650 F. Supp. 1387 (D. Colo. 1986).” Docket No. 64 at 3. In
Behunin, the court considered whether plaintiffs Gage Behunin and his wife, the sole
shareholders of Gage Behunin Company, adequately alleged an injury independent of
their status as shareholders. 650 F. Supp. at 1393. T he court found that plaintiffs had
sufficiently alleged that defendant at times disregarded the Gage Behunin Company by
dealing with Gage Behunin “individually and/or independently,” including founding a
separate company, with “encouragement and active support of [defendants],” for the
purpose of facilitating the use of Sarabond, the allegedly defective compound which
was the subject of the litigation. Id. The court found that, “[w]here Gage Behunin
doffed the shareholder cap in favor of other headgear, he has properly asserted his
rights as an individual.” Id. at 1394.
Notwithstanding the fact that, unlike Behunin, Bixler is binding legal authority, the
Court disagrees with plaintiff’s argument that Behunin is closely analogous to this case.
As a threshold matter, the Behunin decision does not contain sufficient facts to
determine if an analogous injury or relationship existed between defendants and
plaintiff in his individual capacity. Moreover, the facts that are contained within the
decision do not necessarily support plaintiff’s position. Here there is no allegation,

13

unlike Behunin, that defendants induced plaintiff to create a new company; rather,
plaintiff’s interactions with defendant centered around a loan, made to the Yellowstone
Club, not to him. As noted in the Order, although “plaintiff used loan proceeds for his
personal use, it is undisputed that the loan itself was made to the Yellowstone Club –
and not to plaintiff – meaning that a loss arising from a default would be suffered by
creditors, not the borrower.” Docket No. 61 at 14. In addition, plaintif f entered into the
Credit Agreement in his capacity as president of BGI and manager of the Yellowstone
Club. The Court acknowledges that, because diminution in value of shares is not the
only injury plaintiff alleged, Bixler is not factually analogous in every respect. However,
more damaging to plaintiff’s argument for reconsideration is the fact that plaintiff makes
no attempt to distinguish Niemi, a case with similar facts, where plaintiffs sought to
invoke the exception to the shareholder standing rule. 728 F.3d at 1260-61. In Niemi,
the plaintiffs’ corporation paid $2.18 million to secure a loan from defendants and, when
the loan failed to materialize, plaintiffs brought suit as individuals. Id. at 1253-54. The
Tenth Circuit held that, because plaintiff admitted signing the loan agreement in his
capacity as manager of the subject corporation and did not dispute “sen[ding ] money to
the defendants only in their roles as [the corporation’s] creditors to satisfy [the
corporation’s] contractual duties to the defendants,” there was no basis upon which to
conclude that plaintiff established “a direct and personal loss of their own.” Id. at 126061. The Court finds the facts of Niemi much closer to the facts here than those
identified in Behunin.

14

Second, plaintiff appears to argue that the Court relied too heavily on Sparling v.
Hoffman Constr. Co., Inc., 864 F.2d 635, 640-41 (9th Cir. 1988), a case plaintif f
interprets as holding that, where plaintiffs are the sole shareholders of a corporation,
plaintiffs cannot show that their injury is distinct from other shareholders. Docket No.
64 at 5-6. Plaintiff argues that he was not the sole shareholder of the Yellowstone Club
and, as such, that Sparling is distinguishable. Plaintiff’s argument rests on a
misinterpretation of Sparling and the Court’s Order. Plaintiff is correct that Sparling
holds that sole shareholders cannot, absent a special duty , show an “injury distinct from
that to other shareholders.” 864 F.2d at 641. However, the case additionally stands for
the more analogous proposition that “[a]ny harm to the [plaintiffs] due to their status as
guarantors of the bonds given by the corporation is also derivative of the harm to the
corporation [and] does not give the [plaintiffs] standing.” Id. Although plaintiff suggests
that the Court’s decision rests upon an erroneous f actual conclusion that plaintiff was
the sole shareholder of the Yellowstone Club, the Court made no such conclusion. To
the contrary, the Order notes that, although plaintiff was the sole shareholder of BGI,
BGI owned only 89% of the Yellowstone Club. Docket No. 61 at 2. Moreover, the
Court’s analysis focused on whether plaintiff’s injuries were distinct from the
corporation, not from other shareholders, and plaintiff fails to provide any citation to the
Order suggesting otherwise. Finally, the Court’s order cited Sparling in a single
instance without any further discussion. Thus, plaintiff’s argument fails.
Plaintiff argues that his non-derivative injury stems in part from the fact that he
personally paid $42 million in interest to the Yellowstone Club. By plaintiff’s own

15

admission, this fact was not alleged in the complaint, Docket No. 64 at 4 n.1, and, as
such, is not a basis upon which the Court is required to reconsider its order. See
Servants of Paraclete, 204 F.3d at 1012. Moreover, the fact that plaintiff may have paid
interest on a loan made to the Yellowstone Club does not create a non-derivative injury.
Such payments had the effect of satisfying the Yellowstone Club’s contractual loan
obligations and do not assume a personal character simply because plaintiff paid them.
See Niemi, 728 F.3d at 1260-61 (plaintiff’s guaranty of corporate loans, which had
effect of satisfying corporation’s “contractual duties,” not “enough to establish a direct
and personal loss”).
Plaintiff’s remaining arguments are that (1) defendant represented that the $209
million loan was for plaintiff’s benefit, (2) plaintiff’s injuries flow, not just from the loan to
Yellowstone Club, but from defendant’s scheme, (3) Credit Suisse encouraged plaintiff
to use the loan proceeds for personal use while plaintiff was not acting on behalf of the
corporation, and (4) plaintiff suffered independent damages in the form of legal fees,
lost business opportunity, and damage to his reputation. Docket No. 64 at 4-7.
Plaintiff’s motion, for the most part, fails to support his arguments with citations to the
relevant portions of the complaint and the Order and, as such, fails to identify the basis
for his claim of clear error. See generally id. Moreover, plaintiff’s arguments are
substantially identical to those advanced in his response to Credit Suisse’s motion to
dismiss, Docket No. 69 at 3, which were addressed in the Order. See, e.g., Docket No.
61 at 13-14. Therefore, plaintiff fails to show, as it is his burden to do, that his claim
falls within the exception to the shareholder standing rule and, as a result, fails to

16

provide a sufficient basis for the Court to find that its prior ruling was clearly in error.9
Plaintiff’s motion for reconsideration will be denied.
III. CONCLUSION
For the foregoing reasons, it is
ORDERED that Credit Suisse’s Motion for Reconsideration [Docket No. 63] is
DENIED. It is further
ORDERED that plaintiff’s Motion to Reconsider Court’s Order Granting Credit
Suisse’s Motion to Dismiss in Part and Cushman and Wakefield’s Motion to Dismiss
[Docket No. 64] is DENIED.

DATED September 26, 2014.
BY THE COURT:

s/Philip A. Brimmer
PHILIP A. BRIMMER
United States District Judge

9

The Court declines to consider arguments that plaintiff advances for the first
time in his reply brief. See Docket No. 75 at 2; Tran v. Trustees of St. Colls. In Colo.,
355 F.3d 1263, 1266 (10th Cir. 2004) (“Issues not raised in the opening brief are
deemed abandoned or waived.”).
17